Hiring a Financial Advisor?

Hiring a financial advisor may sound daunting, but knowing what questions to ask can take some of the anxiety out of the equation. Here are five questions that you can ask when you’re up for the task!

How are you paid?

Before you sign on the dotted line, you will want to have a crystal clear understanding of the costs involved with your decision. Ask your potential advisor how they receive their pay. Will they earn a commission, or do they assess a flat fee? Are there other fees or costs that you will be responsible for? Any unexpected costs can have a serious impact on your finances, so be sure you are well-informed and comfortable with the potential costs.

What are your qualifications?

Is your advisor experienced? What is their professional background? Are they designated as a Certified Financial Planner? Before you commit to any partnership, ask your advisor to provide their credentials. You can do further research into what is required for financial advisors, as well as additional special designations that can be assigned to them.

What can I expect from working with you?

Nobody has a crystal ball to see into the future, but a seasoned financial advisor can discuss common scenarios that their customers might experience. Ask them what clients with a similar portfolio and investment style have been through and how those situations impacted their bottom line. Be sure to ask how they will be keeping in contact with you. Can they be reached after-hours, or are they strictly available by appointment? Will you have regular phone and email communications? What happens if you want to change your investment plan?

Your goals

Before you can hire the right professional for you, you need to know what it is that you want. Be clear with your goals. Are you looking to build wealth? Ensure a stable retirement? Become an investing guru? Whatever it is that you want, be sure to clearly discuss this with your advisor. After all, they can’t help you meet your goals if they do not understand them and feel comfortable putting you on that path.

Are there tax implications to investing?

Before diving in, you will need to understand the tax implications of investing. The last thing you want is a surprise bill from Uncle Sam.

What other questions would you ask a financial advisor? I want to hear from you. Leave a comment below or email me.